BRUSSELS, March 11 (Reuters) – Google Inc closedits $3.1 billion acquisition of online ad delivery companyDoubleClick Inc on Tuesday, just hours after the deal wonunconditional approval from the European Commission.
The approval came despite objections from rivals andprivacy advocates and followed an in-depth investigation byEuropean competition officials. The merger, announced a yearago, was given a go-ahead by U.S. antitrust authorities latelast year.
The European Commission, the European Union’s executivearm, said the companies operate in different parts of theonline advertising world and their deal was not a marriage ofrivals.
"Google and DoubleClick were not exerting major competitiveconstraints on each other’s activities and could, therefore,not be considered as competitors at the moment," it said.
Google has by far the strongest position in Web searchingin Europe. That gives it an edge on the simple ads it sells,which appear on its search pages.
DoubleClick deals with fancy display ads that it deliversto many kinds of Web sites.
DoubleClick supplies the technology used in what is knownas "ad serving," which allows advertisers to target potentialcustomer and measure how well their ads are received. Itsservices are a boon to Web site owners who fill the blank spaceon Web pages with brand adverting delivered by DoubleClick.
Ad serving funnels the advertising of clients to one ofseveral ad networks, such as Google’s AdSense, which act asauctioneers connecting buyers and sellers of ads and ad space.
The Google-DoubleClick deal drew opposition from rivalssuch as Microsoft Corp and Yahoo Inc.
The European Commission said once Google and DoubleClickcombine, they will still be unable to marginalise other adservers that have become attractive to big technology players.
The online ad industry rapidly consolidated last year.Microsoft bought aQuantive for $6 billion, Yahoo boughtBlueLithium for $300 million, and Time Warner Inc’s AOLunit bought Tacoda for an undisclosed amount.
Privacy advocates complained that the Google-DoubleClickdeal would allow the companies to combine their differentmethods of gathering information about the habits of Websurfers.
One opponent characterised the gathering of information asa form of market power — the ability of a company to raiseprices or damage competitors.
The European Commission’s statement sought to play down theconcerns, saying the deal was unlikely to have harmful effectson consumers, at least in the markets it considered.
The commission and the U.S. Federal Trade Commission saidprivacy was outside the scope of a competition review. Thecommission’s statement on Tuesday had nothing to say aboutprivacy.
One privacy advocate, the Center for Digital Democracy inWashington, said the FTC and the European Commission must thinkabout the Web in a different way.
"U.S. and European policymakers must reform the antitrustprocess to reflect the realities of the digital market era,where competition, data collection and content creation areseamlessly intertwined," it said in a statement.
(Additional reporting by Eric Auchard in San Francisco;Editing by William Schomberg, Quentin Bryar and John Wallace)
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